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This report was compiled by PwC’s Capital Projects and Infrastructure Transport and Logistics team using a combination of information obtained from interviews with port authorities and port operators, together with detailed research and incorporating our extensive knowledge of the port, trade and transport sector. Extract: New drivers for African ports (pdf). Ports around the world are changing, not only in terms of how they integrate into the logistics chain and the role they play in economic development, but also in terms of how they are operated and managed. Some key trends that are directly applicable to Africa, include:

(i) Tracking and digital platforms are the norm: Logistics service providers and customers are increasingly using radio-frequency ID tags and tracking devices to accurately determine vehicle and consignment locations. (ii) The paperless port. Through increasing utilisation of digital technology and a shift by customs and excise authorities to use the internet as the means of processing shipments, there has been a significant decrease in the use of paper at ports. (iii) Improved inland terminals. These help consolidate freight flows and act as important hubs from where corridors may diverge. Because of border control requirements, they are often located close to border points and also often offer bonded warehouse facilities. (iv) Hub ports. They have developed in most parts of the world and demonstrate a shift towards greater maritime freight consolidation. Their emergence has been driven to a large extent by the global trade in containers, which continues to grow and is reducing the size of the break-bulk and in some instances even the bulk market. (v) Improved back-of-port logistics facilities. The area behind the port has become increasingly sophisticated and specialised in recent years. Holding facilities for specialised commodities, such as edible oils, foodstuffs, etc. are now common in areas close to the port.

Global wheat trade is forecast at a record for 2017/18, with Sub-Saharan Africa projected to have the strongest year-over-year import growth of any region (pdf). In fact, over the last decade as a whole, Sub-Saharan Africa has been a major driver of rising global wheat trade. Stagnant production and rapid consumption growth have been the main motivators of rising import demand in the region. Consumption is escalating on long-term trends of urbanization, rising incomes, and population growth. This year specifically, record global production and relatively low prices have further catalysed import demand in Sub-Saharan Africa. Russia is an increasingly important supplier for the region as many of these markets are primarily focused on obtaining low-priced supplies. In light of Russia’s record crop and large exportable surplus, Sub-Saharan Africa’s demand growth has provided an outlet to absorb some of those excess supplies. [West Africa Brief: The 2017-18 agro-pastoral campaign]

Nigeria produced an average of 80,000 metric tons of wheat a year for decades until the introduction of a new variety in the 2012-13 season that tripled the average yield as more areas were cultivated, according to the Lake Chad Institute. Output fell sharply to 60,000 metric tons in the 2016-17 season after reaching a peak a record of 350,000 tons in 2013-14, according to Turaki, with farmers also hurt by the Boko Haram Islamist insurgency in some of the growing regions. He sees a further production decline in the current season to 50,000 tons. In contrast, Nigeria’s wheat imports, which reached 4.6 million tons in 2017, are expected to expand by 9% to 5 million tons next year and to double from that by 2030, according to the US Department of Agriculture, as demand surges for wheat-based foods such as pizza, pasta and bread. The West African nation estimates it spends $4bn to $5bn annually on wheat imports. [Related:Nigeria’s maize import hits N146.8bn; How smuggling stalls rice self-sufficiency target]

Multibillion-euro dairy multinationals are exploiting rock-bottom European milk prices to expand aggressively into West Africa. Over five years, they have nearly tripled their exports to the region, shipping milk powder produced by heavily subsidized European farmers to be transformed into liquid milk for the region’s booming middle class. West Africa, with its growing population and demand for dairy, was an obvious destination. Between 2011 and 2016, milk powder exports from the EU to West Africa jumped from 12,900 metric tons to 36,700 tons — most of it flowing to plants in Senegal, Ivory Coast, Ghana and Nigeria, which re-export the product to their neighbouring countries. As global players such as Danone, Arla and FrieslandCampina set up reconstitution plants to process imported European milk, West African farmers are struggling to compete. Although local production has never fully met demand, experts warn that the recent milk deluge risks smothering the local industry, miring the region in dependency.

Chairman of Butimba Bemaswati Hawkers Association Isaac Masombuka feels that hawkers are constrained by many things such as the lack of choice in the goods they purchase. The association comprises about 270 men and 470 women hawkers, whose source of income is buying goods in South Africa and Mozambique to sell them in Swaziland. He said South Africa, for instance, was regarded as a hawkers haven, when in reality, all that country mostly has to offer are China produced goods for the average Swazi hawker and very little else. In Masombuka’s view, apart from the made-in-China products, South Africa has a good range of upmarket products which are mostly too expensive for the target market in Swaziland. Masombuka said as far as he understands it, the ACFTA would give hawkers like himself the opportunity to explore other African countries apart from South Africa and Mozambique with ease to get diversified products which they can introduce to the local market.

The IGAD Secretariat congratulates the Government of Kenya for being one of the first countries to approve the framework establishing the AfCFTA on 27 March 2018. The IGAD Secretariat also welcomes the signature of the AfCFTA by all member states of IGAD (Djibouti, Ethiopia, Somalia, South Sudan, Sudan and Uganda) and will endeavour together with the African Union to work alongside its Members States to facilitate efforts to enhance free trade within its respective region and across the continent.

The SADC Secretariat is developing a legal instrument that will improve the policy environment for industrial development and support implementation. The development of a regional industry protocol should strengthen the economies of countries in SADC and ensure that they are driven by industrial development and not based on exports of raw resources. SADC Executive Secretary Dr Stergomena Lawrence Tax said the proposed protocol will provide for a supportive policy environment for the implementation of the SADC Industrialisation Strategy and Roadmap across sectors. The final draft protocol is expected to be ready by the end of 2018.

The Nigeria-Malaysia Business Council has collaborated with the Nigeria Export Promotion Council and the Malaysia Department of Trade to set up a special trade corridor that will enable Malaysian businesses and Nigerian farmers and exporters to collaborate with a view to adding quality to goods exported from Nigeria to Malaysia. According to NEPC, special focus will be on crops such as cocoa, palm produce, rubber and solid minerals that are mostly exported in their raw form to Malaysia and other markets. The Malaysian Trade Commissioner, Moamar Kareem, said that Nigeria was the most lucrative country to trade with, adding that the commission recently relocated its office from Nairobi to Lagos for this reason.

Standard Chartered has launched its G7 to E7 Trade Performance Index (pdf), which examines the trading partnerships of the G7 with E7 (Emerging Seven) economies – Bangladesh, China, India, Indonesia, Nigeria, Pakistan and Vietnam. The UK, US and France stand to realise the greatest gains if they can fulfil their E7 trade potential. Germany tops the performance table as the only country to currently exceed its total E7 trade potential. The Index reveals that G7 nations and companies are underperforming in their export trade to the E7. Of the 49 trade routes between individual G7 and E7 countries, only nine currently exceed or meet expectations. The remaining 40 trade routes underperform by a total of $162bn against their export potential. This constitutes a 30% annual growth opportunity for the G7 to the E7. The E7 represent a critical highway to future growth for the G7 in 2018 and beyond.

Boeing has instituted an internship programme to help nurture young talent in Africa, and works closely with airlines across the continent, as it has done for more than 60 years. One example is aviation firm Comair, which now has a 40% share of the South African market and has operated profitably for more than 70 years. It now trains pilots and cabin crew for 37 airlines and its training facility is doubling in capacity to meet demand. In 2019 Comair will take delivery of the first of its eight Boeing 737 MAX8s as the final phase of its fleet replacement strategy for its two brands, kulula.com and British Airways. There is no single catalyst to realising Africa’s potential for socioeconomic development, but liberalisation of aviation, modernisation of the sector and empowerment of human capital to embrace opportunities in that sector could be a powerful driver of growth in the coming years. Watch this airspace. [The author Boeing sub-Sahara Africa managing director]

Global Head, Client Relations, Afreximbank Rene Awambeng, made the call at the Roadshow for Russian Aviation Products and Capabilities in Africa held in Abuja on Thursday. “Why can we not develop our own national and regional airline companies and private sector airlines to bring down the cost of travels for our people? Why must air France dominate all the routes to the francophone west Africa? Why can we not have an African champion in the air industry?These are some of the questions our Nigerian leaders and industries should think and take responsibility.”

“GSP provides an important tool to help enforce the Trump Administration’s key principles of free and fair trade across the globe. The President is committed to ensuring that those countries who receive GSP benefits uphold their end of the bargain by continuing to meet the eligibility criteria outlined by Congress,” said Deputy U.S. Trade Representative Jeffrey Gerrish. “We hope that India, Indonesia, and Kazakhstan will work with us to address the concerns that led to these new reviews.” For India, the GSP country eligibility review is based on concerns related to its compliance with the GSP market access criterion. For Indonesia, the review is based on concerns related to its compliance with the GSP market access criterion and the GSP services and investment criterion. Kazakhstan’s eligibility review is based on concerns related to its compliance with the GSP worker rights criterion. A public hearing and comment period for the new GSP reviews of India, Indonesia, and Kazakhstan will be announced in an upcoming Federal Register notice. [Bloomberg: Get ready for the unintended consequences of Trump’s trade war]

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This post has been sourced on behalf of tralac and disseminated to enhance trade policy knowledge and debate. It is distributed to recipients across Africa and internationally, serving in the AU, RECs, national government trade departments and research and development agencies.